Decentral or Central is not the question
For the sake of this blog post, I would like to describe the majority of all business models, including banking, as an ecosystem of middlemen interacting. The client is standing on the sidelines and not being able to change this system to act in his favor (if the system does not want it). Disruptive business models are mostly aiming to change this fact. Although, technically, from a user’s perspective, changes that are giving more power to the users are not necessarily disruptive (or disturbing) in their view.
But, naturally, the middlemen would deem any technology or technology-centered business, which works under a peer to peer schema, as disruptive. Their supporters are more than skeptical about the mechanisms of self-control, the absence of central regulation, and last but not least, the replacement of old established trust with algorithms in P2P.
The crowd, often referred to as supporters of the ideas that are published by internet libertarians or cypherpunks, deems the peer to peer business model as the only way into the future as it can create transparency and act neutrally with no hidden agendas, be faster, cheaper, etc.
Well, here is the catch, technically, yes this could be possible with a P2P model if all acting agents and robots would work that way. Apparently the creators of bitcoin did spend quite some time ensuring that the bitcoin network adheres to these principles. Note: Blockchain was only one building block of this, not the only building block. If not, well, then any P2P network is as unfair as any man-in-the-middle business scheme can be.
What most P2P-based interaction models have in common, in my view, is a higher entry barrier for the users; you usually need a certain level of technical expertise to make it work and, ideally, some on-site peers to help you get started, for example, OpenBazaar and bitcoin.
In banking, at least in payments, we see a tendency to move into P2P with the aid of some telco or big tech company to solve the entry problem, eventually leaving the middlemen on the outside or reducing them to service providers, rather than dealmakers.
Is there a place to add value in P2P?
Peer-to-peer is correctly feared by middlemen and owners of established value chains because the competition can quickly become asymmetric if the model takes off (a frightening experience the music industry does not even want to talk about, even now, years after the “go live” of The Pirate Bay and its clones).
Is there no place in the peer-to-peer business model for individuals other than consumers and producers? Is there no additional value to be created and offered? I think there is. The previously mentioned higher entry barriers as well as aspects such as market overview, curation, matchmaking, etc., are problems that will demand a solution in due time after the model’s mass adoption.
One could say that it is convenient to use the peer-to-peer business model as it is a platform-based business model; unfortunately, the same catch exists here as in the old model, and, in fact, the P2P model may be even worse as there is only one middleman calling the shots.
Is P2P always evil?
No, indeed not. Crowdfunding and philanthropy rallying are two examples that would not even exist without P2P.
If we adopt the views of Internet libertarians for a moment, then all participants should start on an equal footing. Therefore, current business agents must transform into something close to peers, in other peers’ view. Offering added value from there and growing with the accompanying acceptance provide evidence that real additional value is there. Then, who knows, your average financial services advisor will look like a legal and more decent incarnation of “The Pirate Bay” guy curating access to services for users.